still relevant: http://mises.org/library/end-sound-m...ony-capitalism
That's not the laissez faire
still relevant: http://mises.org/library/end-sound-m...ony-capitalism
punchbowl removed too quickly?
https://www.minneapolisfed.org/news-...ommunity-banksMy summary assessment is that the FOMC underperformed in the past three years with respect to the price stability mandate and the employment mandate. I’m sometimes asked, “What concrete actions could the FOMC have taken to provide additional stimulus?” I think one concrete action would have been not to reduce stimulus. In mid-2013, the FOMC began communicating about the eventual elimination of its asset purchase program that took place from December 2013 and October 2014. These communications, and the follow-up actions, served as a tightening of monetary policy. Accordingly, they were associated with sharp increases in market interest rates and sharp reductions in the rate of home mortgage refinancing.
even their most ardent enemies will admit, the swift abandonment of principle in a dire moment, was one of their virtues. gold-plated socialism for big banks and traders couldn't have been possible without it.
Stockman takes a swipe at Yellen after the putative end of ZIRP:
http://davidstockmanscontracorner.co...dread-the-fed/In point of fact, the primary source of private sector credit growth since the pre-crisis peak has been in the business sector. Credit market debt outstanding in nonfinancial business has risen from $10.6 trillion on the eve of the financial crisis to $12.6 trillion.
Yet the lion’s share of that $2 trillion gain is accounted for by the surge of high yield loans and bonds, which have more than doubled from $1.2 trillion to $2.6 trillion during the same period.
And one thing can be said with authority with respect to this soaring pile of junk. Namely, that it was overwhelmingly used for financial engineering in the form of stock buybacks, M&A deals and LBO’s. It thereby help to drive up the price of existing financial assets, not expand the US economy’s productive capacity and efficiency.
In this context, the march of the junk debt yield curves shown below says it all. The Fed’s heavy-handed financial repression did not trigger a domestic investment boom as Bernanke promised the Congress over and over during his twice yearly forays in deception on Capitol Hill; it simply stampeded yield-starved money managers and retail investors alike into the junk bond market regardless of risk.
Stated differently, the major channel of monetary policy transmission that actually worked during the past seven years was the junk debt market. And that $2.6 trillion enterprise in the mispricing of risk was the primary driver of $5 trillion in domestic M&A deals and stock buybacks since the crisis.
Yellen and her cohort have no clue, however, that all of their massive money printing never really left the canyons of Wall Street, but instead inflated the mother of all financial bubbles.
So they are fixing to blow-up the joint for the third time this century.
That was plain as day when our Keynesian school marm insisted that the Third Avenue credit fund failure this past week was a one-off event—-a lone rotten apple in the barrel.
Now that is the ultimate in cluelessness.
.
That and the junk bond financed oil frack boom. That was good for hundreds of billions more which stand a good chance of defaulting.
looks like another round of deflation. where's the hyperinflation, CC?
Early on in the ZIRP & QE era the overwhelming belief from fear mongers was that those policies would inevitably result in inflation/hyper inflation as liquidity & easy money started to push more dollars to fewer resources. As such, it is somewhat ironic that one could make a reasonable argument that QE and ZIRP policies played a large role in oversupplying not only the oil and gas markets, but commodity markets in general. Along with the velocity of technological innovation we’ve seen in America’s oil fields this access to cheap capital allowed drillers to vastly increase both the number of wells drilled and the amount of oil/gas extracted from each well.
global deflationary headwinds:
http://www.telegraph.co.uk/finance/e...o-reverse.htmlThe world’s most powerful central banks will be forced to tear up their plans following the carnage that has engulfed financial markets since the beginning of the year.
Investors now believe there will not be a single interest rate rise from any of the G7 group of central banks this year, while the number of expected rate cuts this year has increased from zero to six.
QE, before and after
Last edited by Winehole23; 06-17-2019 at 10:30 AM.
Cheap credit keeps zombies afloat:
so much for the rising tide floating all boats
Last edited by Winehole23; 06-17-2019 at 10:35 AM.
Nouriel Roubini reads the tea leaves regarding the next contraction:
https://www.project-syndicate.org/co...oubini-2019-06Under these conditions, a severe enough shock could usher in a global recession, even if central banks respond rapidly. After all, in 2007-2009, the Fed and other central banks reacted aggressively to the shocks that triggered the global financial crisis, but they did not avert the “Great Recession.” Today, the Fed is starting with a benchmark policy rate of 2.25-2.5%, compared to 5.25% in September 2007. In Europe and Japan, central banks are already in negative-rate territory, and will face limits on how much further below the zero bound they can go. And with bloated balance sheets from successive rounds of quan ative easing (QE), central banks would face similar constraints if they were to return to large-scale asset purchases.
On the fiscal side, most advanced economies have even higher deficits and more public debt today than before the global financial crisis, leaving little room for stimulus spending. And, as Rosa and I argued last year, “financial-sector bailouts will be intolerable in countries with resurgent populist movements and near-insolvent governments.”
The non-oligarchy simply can't defeat, or even contain, the oligarchy armed with $10Ts, aided and abetted by the totally corrupt Repug stooges, now corrupting, destroying the "administrative state", and packing the Federal judiciary with Leonard Leo's incompetent, young, right-wing extremist politicians to serve as "judges"
boutons says WE ARE DOOMED
$12T in bonds in sub zero territory. The smart money is willling to pay a premium to park its money with zero chance of a profit.
http://archive.is/zS44d
The Great Boutons is infallible
been waiting for YEARS for anybody here to show in practice how to avoid climate catastrophe or disempower the wealth-extractive oligarchy.
It's very odd you'd expect to find solutions to real world problems on a discussion board.
Especially this one.
So many experts here, why not?
Nobody even tries, other other some silly jokes about pendulums or voting
Last edited by boutons_deux; 06-17-2019 at 07:43 PM.
Others just pooping their pants and whining about ed and un able.
.
posting spam is "doing something".
Still true seven years later, the Fed just announced QE4.
So much for monetary normalization, the emergency propping up of "systemically imporant" ins utions by central banks appears to be permanent.
The gold-plated socialism for banks and investors inaugurated by Obama continues under Trump. For the rest of us, there's rat race capitalism, debt peonage and fiscal austerity.
It's all worth it so banks will never have to face the consequences of fraud and bad decisions like the rest of is.
https://blog.independent.org/2019/09...tative-easing/Because the flood of new government-issued debt securities that the U.S. Treasury will be issuing in the months ahead is so large, the Fed will feel compelled to “resume the organic growth of the balance sheet sooner than we thought,” in the words of Fed Chair Jerome Powell this past week. Which is to say that the Federal Reserve is getting set to restart its quan ative easing policies within the next few months.
Last edited by Winehole23; 10-19-2019 at 11:13 AM.
"government-issued debt securities"
... as we saw with earlier QEs, 90%+ of the Fed's money goes to enrich the rigged Fed's scamming owers: BigFinance.
QEs bail out Wall st, not Main st
Last edited by boutons_deux; 10-19-2019 at 11:27 AM.
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